A 1% rise in public investment represents a similar increase in private investment, according to the Bank of Spain

The organization calls for making good use of European funds so that they contribute to economic evolution in the coming years

MADRID, 25 May. (EUROPA PRESS) -

The Bank of Spain calculates that an increase of 1% in public investment would be associated with an increase of the same magnitude in private investment in the short term, for which the body has underlined the importance of making adequate use of the European funds 'Next Generation EU'.

"It is important to carry out a rigorous selection of the projects that are part of this program, so that they are aligned with the objectives of structural transformation of the Spanish economy in the medium and long term", the Bank of Spain has remarked.

And it is that of the total volume of resources that Spain could receive in the form of transfers from European funds, close to 80% of the total would be destined for public investment actions, hence the claim of the Bank of Spain to put the funds to good use. same so that it affects private investment and contributes to economic evolution in the coming years.

According to the article 'The response of private investment to an increase in public investment', published this Wednesday by the body headed by Pablo Hernández de Cos, the effect of public investment on economic activity will depend, among other factors, of its effect on private investment, whose sign is, a priori, "ambiguous".

However, the agency points out that this trend has recently stopped, because, in response to the health crisis, this component of spending has been boosted. In addition, the agency has anticipated that this component will be boosted in the country by the European funds received under the Next Generation EU (NGEU) plan.